A Usurper in the CFPB

Less than a decade ago, we found ourselves facing one of the worst economic crises in our nation’s history, due in no small part to the predatory practices by some of our largest financial institutions. In response, a Democrat-led Washington passed the Dodd-Frank Wall Street Reform and Consumer Protection Act to increase regulations on the financial industry. This established the Consumer Financial Protection Bureau, a watchdog over banks and other financial institutions that protects American consumers from unfair and abusive practices.

On Friday, Obama appointee Richard Cordray stepped down as Director of the CFPB. Because the CFPB is an executive agency, the president would generally have his choice of who leads as acting director until his nominee is confirmed by the Senate. He chose former Republican congressman and most recently Director of the Office of Management and Budget, Mick Mulvaney.

The problem here is that the CFPB was intentionally set up to be protected from disproportionate influence by the presidency. In the event of a director resigning before the end of their five-year term, Dodd-Frank specifically stipulates that the deputy director, in this case Leandra English, is to serve as acting director until the Senate confirms the president’s nominee. President Trump is disregarding this law, plain and simple. To her credit, English has filed a lawsuit against the Trump Administration in an attempt to block Mulvaney’s interim appointment.

There is another troubling component of this latest development: it serves as yet another example of President Trump appointing someone who has been a vocal critic of an important executive agency to lead that agency. As a congressman, Mulvaney called the CFPB a “sad, sick joke” and is on the record supporting its abolition. On his first day, he implemented a 30-day hiring freeze and ceased all payments from the CFPB Civil Penalty Fund, except those required by law. This fund is the mechanism by which the CFPB compensates consumers harmed by companies’ illegal actions. Mulvaney has wasted no time intensifying the anxieties of those who suspected he had been sent there to obstruct the agency’s operations.

As if it weren’t bad enough that the man in charge of enforcing our nation’s laws has proven once again that he has no interest in enforcing, or even abiding by, any laws that do not suit his agenda, this is also just the latest demonstration of how badly those in his base who hailed him as an “outsider” have misjudged him. Trump is the insider of all insiders. The only interests he has in mind are those of people like him: the filthy rich. Mulvaney’s appointment is an attack on the CFPB, and by extension, an attack on middle and working class people, many of whom lost jobs and homes in 2008, all for the sake of returning the financial industry to the reckless behavior that led to the crisis in the first place. It is nothing short of an act of class warfare. Supporters of Trump and Mulvaney are either super-wealthy or advocating against their own interests. What’s happening at the CFPB now is indeed a “sad, sick joke”.